Restoring trust in audit and corporate governance

Of interest to all members

Following the consultation last year, the Government published its formal response to Restoring Trust in Audit and Corporate Governance on 31 May.

We have summarised the proposals in two articles in Governance and Compliance, the first published in the June/July edition, which can be read here and the second in the forthcoming August edition.

The Financial Reporting Council (FRC) has now published its own position paper in response to the Government paper, setting out how the FRC will support the Government’s reforms as it transitions into the Audit, Reporting and Governance Authority (ARGA). As the FRC notes, “The purpose of this Position Paper is to provide clarity on how the FRC will address issues in the Government Response which currently fall within our remit. It allows our stakeholders to understand how that work will be delivered, by building on the “what” in the Government Response and explaining “how” and over what period. Our stakeholder engagement will also allow us to ensure that the reforms do not contain unforeseen consequences (for instance, changes to Corporate Governance may have knock-on implications for Audit), and ultimately that they can be delivered by those that we regulate in a way that meets legitimate public expectations but without disproportionate cost or burden.”

The FRC position paper (14 pages) can be read here.

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